SUSD examines 'what if's' of Prop. 30 failure

Wednesday

Sep 26, 2012 at 12:01 AM

STOCKTON — California school districts have been struggling financially for years because of the state's financial woes, but Stockton Unified Superintendent Steve Lowder says the worst may be yet to come.

By Roger Phillips

STOCKTON — California school districts have been struggling financially for years because of the state's financial woes, but Stockton Unified Superintendent Steve Lowder says the worst may be yet to come.

With Election Day six weeks away, Lowder and Chief Business Official Wayne Martin spoke at Tuesday night's school board meeting about the problems that will confront Stockton Unified and other California districts if voters reject Gov. Jerry Brown's school-tax proposition.

Lowder said Proposition 30's defeat would be the worst blow yet for public-education funding in California.

“You almost become a bit jaded,” Lowder said. “But I do believe this is probably the biggest problem we've faced.”

Lowder said the district would be “insolvent” at the end of the 2013-14 fiscal year if Prop. 30 fails. The numbers Martin presented were stark.

According to Martin, the district will have to cut more than $15 million from its $296.6 million general-fund budget in February if voters reject Prop. 30 in November. Passage of Prop. 30, Martin said, would allow districts to maintain current funding levels.

Currently, 37,000-student Stockton Unified receives $5,165 a student in average-daily attendance funding from the state. If Prop. 30 loses, Martin said, the district will lose $441 for each student, dropping its per-pupil funding to $4,724.

The district would have very few options to make up for the loss of funding, Lowder said.

According to the district, 92.3 percent of its general fund is spent on salaries and employee benefits, with the balance used on items such as utilities and telephone costs, textbooks, insurance and office supplies.

Martin said the district probably will have to choose from a menu of three options if voters reject Prop. 30, which includes a quarter-cent sales-tax increase and up to a 3-percent increase in the personal income tax rate for those earning $250,000 or more a year.

According to district figures, Stockton Unified could reduce its general fund by $15 million with a 9.4-percent across-the-board salary cut, by eliminating up to 25 days from the 179-day instructional calendar, or by increasing class sizes, especially for kindergarten. More likely would be a combination of those options.

“We're pretty much out of ammunition,” Lowder said. “There's not very much else to cut.”

If the cuts prove necessary, the district will have to bargain the reductions with its unions, especially the Stockton Teachers Association and the California School Employees Association, which represents school support staff.

Concern is mounting among some in education circles because of polling that shows sagging voter support for Prop. 30. A Field Poll released last week showed Prop. 30 receiving only 51 percent support, with 38 percent opposing the measure. Support has dropped by three percentage points since a Field Poll in July.

Stockton Teachers Association President Ellen Old said she believes voters will pass Prop. 30. If they don't, she said, “We'll go to the bargaining table, look at a new reality and proceed.”

She said the district's cash reserves are large enough, though barely, to see the district through this year if Prop. 30 fails.

“Those are rainy-day funds and sometimes we just have to acknowledge it's raining,” she said.

Dan Morris of CSEA said past “bad-faith bargaining” by the district would make for trying negotiations if Prop. 30 fails. Morris said defeat of Prop. 30 would “present another opportunity for friction and finger-pointing.”

At Tuesday night's meeting, Monroe Elementary administrative assistant Rose Parker, who is represented by CSEA, said workers are weary of the district “crying poor.”

“I am hoping, Superintendent Lowder, that now that you are on board here, when budget cuts are needed you take a good, long look at other ways besides attacking the classified staff,” Parker said.

Morris expressed optimism that negotiations will go more smoothly with Lowder at the helm. Morris has known Lowder for more than a decade. Lowder is three months into his tenure with Stockton Unified.

Numerous districts statewide appear to be in more dire financial straits than Stockton Unified or any other district in San Joaquin County.

In May, 12 districts in California received negative financial certifications from the state, and 176 more received qualified certifications. Stockton Unified and every other district in San Joaquin County received positive certifications — the best of the three possible ratings.

Earlier this month, one of the negatively certified districts, Inglewood Unified, received a $55 million emergency bailout and was taken over by the state.

Lowder said Stockton Unified's certification is certain to be downgraded if Prop. 30 is defeated. The district had a qualified certification from March 2011 until returning to positive territory last December.

If Prop. 30 loses, Lowder said, “The best case for us will be qualified.”